Public subsidies and charitable giving: Crowding out, crowding in, or both?

Brooks, Arthur C.

doi:10.1002/1520-6688(200022)19:3<451::aid-pam5>3.3.co;2-5

Cited by 73 publications

(97 citation statements)

References 0 publications

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“…A possible explanation for this result is that the effect is non-linear, with smaller subsidies enhancing donations and larger subsidies discouraging them (Borgonovi 2006;Brooks 2000bBrooks , 2003b). This also means that subsidizing does not make organizations dependent on public funding, but rather seems to encourage revenue diversification at the organizational level.…”

Section: Discussionmentioning

confidence: 99%

“…Furthermore, it has been argued that crowding-out effects vary with the level of government support (Borgonovi 2006;Brooks 2000bBrooks , 2003b, the salience of the tax (Eckel, Grossman, and Johnston 2005), the number of other donors (Ribar and Wilhelm 2002), the difference between public goods that are generally provided by public funding and public goods that are generally provided by private funding (Tinkelman 2010), the linearity of the cost function of public good production (Tinkelman 2010), the number of people that initially do not contribute to a public good (Chan et al 2002;Tinkelman 2010) and substitution between nonprofit organizations or between sectors (Sokolowski 2013;Tinkelman 2010). …”

Section: Other Moderatorsmentioning

confidence: 99%

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Government Support and Charitable Donations: A Meta-Analysis of the Crowding-out Hypothesis

Wit¹,

Bekkers²

2016

Preprint

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Wright for their extensive and useful comments. A previous version of this meta-analysis was presented at the 42nd ARNOVA Annual Conference in Hartford, CT (USA). 2 Government Support and Charitable Donations: A Meta-Analysis of the Crowding-Out Hypothesis ABSTRACTWith the growing body of literature on governance styles in which nonprofit organizations are involved in creating and implementing public services, there is a need for robust evidence on the effects of public funding on nonprofit revenues. This paper systematically reviews previous studies on the crowding-out hypothesis, which holds that private charitable donations are lower in situations of higher government support and vice versa. We find that about two-thirds of previous estimates find a negative correlation (crowding-out), while one third of the estimates find a positive correlation (crowding-in). The results are strongly shaped by the research methods that are used. In experiments, a $1 increase in government support is associated with an average $0.64 decrease in private donations, while non-experimental data analyses find an average increase of $0.06. Random-effects regression models show that, contrary to arguments that are prevalent in the literature, studies that take subsidies to organizations as a measure of government support are more likely to estimate crowding-out than studies that use a measure of direct government expenditures. Central government support is associated with higher charitable donations, while measures that include multiple levels of government tend to find negative correlations. The results challenge the consistency of prior research findings and demonstrate the contextual dependence of the validity of the crowding-out hypothesis.

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Section: Discussionmentioning

confidence: 99%

Section: Other Moderatorsmentioning

confidence: 99%

Government Support and Charitable Donations: A Meta-Analysis of the Crowding-out Hypothesis

Wit¹,

Bekkers²

2016

Preprint

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“…Contributions by others may have decreasing marginal utility: studies of American theatres (Borgonovi 2006) and symphony orchestras (Brooks 2000b) reveal that small increases in public funding have a stronger crowding-in effect than large increases.…”

Section: Altruismmentioning

confidence: 99%

Generosity and Philanthropy: A Literature Review

Bekkers¹,

2007

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We present an overview of the academic literature on philanthropy, divided in two parts. In part one, we discuss the question of who gives how much; in part two, we discuss the question of why people give. In part one, we survey the literature on characteristics of individuals and households that are related to giving. In part two, we identify eight mechanisms as the most important forces that drive giving: (1) awareness of need; (2) solicitation; (3) costs and benefits; (4) altruism; (5) reputation; (6) psychological benefits; (7) values; (8) efficacy. We evaluate the progress in the almost 500 studies we reviewed and suggest directions for future research on philanthropy.

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“…Multiple studies found an inverted U-shaped relationship between government support and private donations (Borgonovi, 2006;Brooks, 2000bBrooks, , 2003Nikolova, 2015). This could be due to donor perceptions, as Borgonovi (2006) suggests that low levels of government support serves as a signal of efficacy while donors start to perceive public funding as undesirable government control above a certain threshold.…”

mentioning

confidence: 96%